Tackle modern slavery head on or face threat to brand and reputation

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The recent case of two Polish brothers who were convicted of trafficking people from their home country to work in the United Kingdom has again highlighted the issues for all businesses in ensuring that they have a robust and transparent approach to addressing the issues that modern slavery presents.

Background

In the run up to the Modern Slavery Act 2015 (the Act) being introduced, the then Home Secretary Theresa May said that modern slavery "is all around us, hidden in plain sight. It is walking in our streets, supplying shops and supermarkets, working in fields and factories…something most of us thought consigned to history books…it is a shameful and shocking presence in modern Britain".

Since becoming Prime Minister, Theresa May has re-affirmed her commitment to tackle the problem of modern slavery, saying in July last year that "Just as it was Britain that took an historic stand to ban slavery two centuries ago, so Britain will once again lead the way in defeating modern slavery and preserving the freedoms and values that have defined our country for generations."

With the possibility of the number of migrants in to the uk likely to increase, the pool of vulnerable people being exposed to servitude may well rise. This will increase the risk to employers, and the need for employers to have in place robust processes and systems to deal with this challenge.

Legal requirements – the transparency statement

The Act requires all commercial organisations (meaning any incorporated body that conducts business within the UK and is involved in the supply of goods or services) which have an annual turnover in excess of £36 million to produce a modern slavery transparency statement which sets out the steps the organisation has taken to ensure there is no form of slavery within its supply chain, or stating that it has taken no such steps. The statement must be published as soon as reasonably practicable after year end and in any event no more than six months after the end of the financial year.

The statement should then be published on the organisation’s website, making it available to any member of the public who wishes to read it.

There is no statutory requirement as to the format of the statement. It should nevertheless reflect a realistic assessment of what steps the business is taking to address the issues of modern slavery.

This might include:

Steps the organisation has taken to identify where it may be at risk to the issue of modern slavery

Steps that the organisation is taking to address these risks

A broad commitment to protecting human rights and removing all traces of slavery and child labour from its supply chains

Staff training.

Unlike many risk assessments, there is a statutory requirement that the transparency statement MUST be reviewed annually, with a requirement that there be continual improvement in this area, year on year.

Non-compliance

It is clear from the recent publicity surrounding the case of the two Polish brothers that stories involving slavery carry the risk of high (and negative) publicity for those businesses that are involved. If businesses are unable to point to a transparency statement and set out the systems and process that they have in place to tackle modern slavery, their reputations can be damaged.

Conversely, a well-constructed approach to dealing with the issue of modern slavery can bring a number of benefits to business, as well as preventing severe human rights violations. The potential benefits include:

Protecting and enhancing brand and reputation

Improved customer confidence

Greater staff retention

Greater loyalty amongst staff and customers

More responsive, stable and innovative supply chains.

It is clear from Theresa May's most recent statement in July 2016 that the Government's focus on tackling slavery is unwavering and, if business does not engage with the Act, then the direction of travel will be for more, rather than less, regulation in this area.

If your business requires any assistance in addressing the issues presented by the Act, please contact Ewen Macgregor or Anna Hart.

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